Asymmetric effects of poverty and inequality on carbon emissions in South Africa

Poverty, inequality, and environmental degradation remain a concern in achieving Sustainable Development Goals (SDGs). Several studies have been conducted on the linkages between income inequality and poverty, but few have considered the relationship between these two economic challenges and environmental degradation or carbon emissions. In addition, most empirical studies focus on linear relationships, ignoring the possibility of the asymmetric impact of poverty and inequality on carbon emissions. The current study aimed to investigate the asymmetric effects of poverty and inequality on carbon emissions in South Africa. The study applied the nonlinear autoregressive distributive lag (NARDL) and error-correction techniques to time-series data from 1990 to 2023. The findings revealed that a 1% increase in GDP per capita increases emissions by 1.59%, whereas population growth contributes 0.27%. In contrast, increases in poverty and inequality are correlated with lower carbon emissions, as poorer and more unequal societies often consume less energy-intensive goods and services. A 1% increase in both poverty and inequality lowers emissions by 1.59% and 1.99%, respectively. In the short run, asymmetric impacts on GDP and inequality have dissimilar effects on emissions, depending on whether there are positive or negative changes. Furthermore, addressing inequality through sustainable urban planning and equitable resource distribution can improve access to modern infrastructure, minimise energy waste, and lower urbanisation-related emissions. Finally, cross-sector collaboration and enhanced environmental governance are critical for aligning social, economic, and environmental policies, ensuring that South Africa meets its climate goals while reducing poverty and increasing social fairness.